Wednesday, September 15, 2010

Plans to save the Royal Mail by turning it into a private sector company with a substantial minority employee shareholding have been met with a highly predictable response from the Communication Workers Union. The CWU, one of the most reactionary of old style trade unions, will target the 71 most marginal Lib Dem and Conservative MPs.

The CWU has been a thorn in the side of Labour, never mind the Coalition parties. As a repository for the most unreconstructed and failed "socialist" policies of the 60s and 70s, they were the ones screaming the loudest against the last government's attempts to part privatise the Royal Mail. Labour's part privatisation had some significant flaws (the biggest being that the company would in effect continue to have the restraints imposed on public sector organisations that do not apply in the private sector) but the principle of changing the ownership to generate the capital needed for investment was right. The CWU fought those plans and the weakness and shambolic nature of the Labour government at the time meant ministers were too scared to take on a vested interest like the CWU.

Labour will by now have completely forgotten (or at least prefer to bury the fact) that they too attempted to privatise the Royal Mail. They will undoubtedly fight the plans of the current government, but they will have to come up with an alternative. Keeping the Royal Mail as it is means the public sector will have to find the capital needed to modernise the company. Given that such capital is now in short supply (remember it was Labour's decision to slash public sector capital investment as a proportion of GDP by 2014 by two-thirds) quite where capital for investment in Royal Mail will come from under Labour is an unanswered question.

Back to the CWU. They are planning to run a campaign against the Coalition MPs in the most marginal seats. That's fine by me. It is after all their democratic right to do so. It comes as no surprise to me. But the CWU, like the Labour party, must explain their alternative. When they have been challenged in the past, they resort to a formula that ignores the real world: restore the monopoly on the sorting of post to the Royal Mail. The effect of that would be to bankrupt the businesses that are now in the mail sector and throw onto the dole those people working for those businesses. If that is still CWU policy, they must be honest about it. But such a policy does not explain where the capital will come from to invest in Royal Mail.

Or is it just that the CWU plans got lost in the post?
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